Merkel, Hollande press Greece on reforms

August 24, 2012

BERLIN - The German and French leaders on Thursday put the pressure firmly on Greece to keep pursuing painful reforms, suggesting they are hesitant to accept the new Greek prime minister's demand for more time to fix his country's battered economy and public finances.

Chancellor Angela Merkel and President Francois Hollande met to discuss how to deal with Greece before Prime Minister Antonis Samaras visits both of them over the next two days. Earlier in the day, Germany's finance minister set the stage for tough negotiations by claiming that giving Greece more time to make reforms would achieve little.

As creditors' impatience grows with Greece, Merkel's government is reluctant to offer significant concessions, but Hollande has generally taken a softer line in the debt crisis afflicting Greece and several other countries in the 17-nation eurozone.

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AP PHOTOGermany's Chancellor Angela Merkel, left, and France’s President Francois Hollande arrive for a statement prior to a meeting at the chancellery in Berlin, Thursday. The leaders of Germany and France are stressing that it's up to Greece to keep pursuing painful reforms as it strives to keep its place in the euro.

In a charm offensive in German and French media this week, Samaras has been arguing that his nation should have more time to complete reforms that are a condition of it continuing to receive bailout loans. Without the help, Greece would be forced into a chaotic default on its debts and could be forced out of the eurozone.

In brief statements to reporters at the chancellery in Berlin, Merkel and Hollande didn't directly mention Samaras' calls - but made clear that it is first and foremost up to Greece to satisfy its creditors.

Athens has faltered in the speed and effectiveness of implementing the reforms, irritating its creditors, notably Germany, which is the single largest contributor to its 240 billion ($300 billion) bailout packages. Weeks of political wrangling in Greece that ultimately brought a coalition government under Samaras to power didn't help.

Greece's continued access to the bailout packages hinges on a favorable report next month from the so-called "troika" of the country's debt inspectors - the European Union, European Central Bank and the International Monetary Fund. If Greece is found to have failed on key economic reforms that are conditions of the bailout loan, vital funds could be halted.

"For me, it's important that we all stand by our commitments, and in particular await the (publication of) the troika report, to then see what the result is," Merkel said. "But I will encourage Greece to follow the path of reform, which demands a lot of the Greek people."

Hollande stressed: "I want Greece to remain in the eurozone. That's my wish. That's our wish." But he added that "of course Greece must make the necessary efforts for this to happen."